Those deals followed Comcast buying FreeWheel ($360 million) in 2014’s first half and AOL buying Adap.TV ($405 million) in 2013’s second half.

“There’s a lot of video inventory out there, but a lot of it is user-generated,” said Chris Ensley, a media investment banker at Coady Diemar. “The quality of video inventory is increasing and people want to be associated with premium inventory that can get premium pricing and premium CPMs.”

Another factor driving consolidation, he added, is that traditional linear TV is evolving and companies are eager to prepare. “They want to ensure they’re digitally focused,” Ensley said. “They’re interested in video platforms so that they can be there when and if the dollars migrate from linear TV to on-demand.”

Large transactions in the digital sector drove M&A volume overall, according to the firm’s findings. The total value of M&A in the digital media, information and tech sectors reached $224 billion in 2014, a 48% increase from 2013’s figure. The firm measures deal activity based on the number of announced deals, which jumped 10.9%.

2014 saw a total of 48 announced M&A deals with transactional costs above $1 billion, up from 34 last year. The year’s largest acquisition by a large margin was Facebook's WhatsApp buy, worth $19.7 billion. This could signal more ad opportunities from chat apps such as Line, Kik and WeChat.

Of the verticals measured in the report, the ad tech and services sector saw the largest increase in total investment, with transaction values more than tripling year over year to hit nearly $7.5 billion. The number of tracked deals in this sector also increased, from 76 to 100.

In addition to video platforms, DMPs were in high demand in 2014. The two big events in this area were Oracle’s $375 million BlueKai buy and RocketFuel’s $236 million [x+1] purchase. Publicis also snapped up RUN DMP, while IgnitionOne nabbed Knotice.

“As you look at advertisers and agencies that work with fewer vendors, that is requiring a lot of ad tech companies to fill out their ad portfolio of services," Ensley said. “If you started out as a point solution provider, you’re now looking to become more of a full-service provider and/or merging or acquiring other point solutions providers to offer a one-stop, seamless solution for advertisers and agencies."

In addition to investment banking, Coady Diemar offers digital media, information and technology consulting and M&A advisory. Its annual “Digital M&A Review for Digital Media, Information and Technology” will be released next week.